Equifax Data Breach: How to Watch Your Back for Identity Theft

I suppose the biggest hint of how serious this news release is for all of us is the fact that the Big Kahunas at Equifax jumped ship before the hack went public. 

Well, that and the timing of this big story while all of the media spotlights are shining on South Florida in expectation of Hurricane Irma. 

So, you need to assume you’re screwed here and do something.  But what? 

Their Site is Sneaky in How It Lets You Know You’ve Been Compromised

If you go to their site, and follow their steps, you’ll get a request to enter the last six digits of your SSN with your last name.  Then you get a message that you will receive their free Identity Theft coverage for one year … but you’ll have to come back on the date that’s given in order to join up. 

Yes, that’s right.  They want you to input the last six digits of your SSN into a site they’ve just admitted was compromised. 

In South Texas, we say they’ve sure got some big huevos, boy howdy.

And that’s it.  That’s the only tip to you that some of your personal information has been stolen from the site.  They don’t give you any details.  Heck, they don’t even tell you “yes, your information is involved.” All you get is this little invite popping up. 

TechCrunch has called them on this as a lack of “actual functionality” and is pushing them to do the right thing here.  Like give us details.

But right now, their site is still sneaky in how it’s letting you know that you’re a part of the pack that’s been exposed to the Dark Side. 

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What Can You Do Right Now?

So, what can you do, now that you know your personal information is out there, somewhere? 

1.  Have I Been Pwned

Well, Kim Komando recommends going over to the web site “Have I Been Pwned” – and that’s good advice. 

Be prepared, you’re not going to like what it tells you.  But at least you know, and can take action.

And you can sign up so the site will give you notice in the future if your accounts have been breached at other sites (like LinkedIn, or Adobe, or Dropbox). 

2. Identity Theft Protection or Credit Freeze

Next, you can get yourself some Identity Theft Protection.  That’s the freebie for one year that Equifax is offering you in the sneaky message affirming that your information on their site has been hacked.

Silly me, but I don’t know that I want to trust their Theft Protection service.  Call me paranoid. 

So, I surfed around and discovered advice from Steve Weisman, a law professor and cybercrime expert, who blogs at scamicide.com. 

In his April 22, 2017, USA Today piece entitled “Is identity theft protection worth it?” Mr. Weisman suggests that maybe it’s not the best course to take.

Instead, he suggests a “credit freeze.”  Go read his article – makes good sense. 

3.  Change Those Passwords

And, of course, you need to go and change those passwords.  Use different ones for each account, too. 

And I’m reading lots of folk suggesting that you do the two-step authentication for added security.  Problem is:  that in and of itself may open you up to being hacked.  Whattha?  Yep. 

Check out the May 2017 article by Joseph Cox in Vice, entitled “We Were Warned About Flaws in the Mobile Data Backbone for Years. Now 2FA Is Screwed.” The key language here (and the scary part):

"Everyone's accounts protected by text-based two-factor authentication, such as bank accounts, are potentially at risk until the FCC and telecom industry fix the devastating SS7 security flaw," Lieu said in a statement published Wednesday. "I urge the Republican-controlled Congress to hold immediate hearings on this issue."

4. Visit the FTC Site

Finally, you can visit the government site which stores lots of information about identity theft.  Like the following things you need to know because Equifax has been hacked.

From the site:

What Do Thieves Do With Your Information?

Once identity thieves have your personal information, they can drain your bank account, run up charges on your credit cards, open new utility accounts, or get medical treatment on your health insurance. An identity thief can file a tax refund in your name and get your refund. In some extreme cases, a thief might even give your name to the police during an arrest.

Clues That Someone Has Stolen Your Information

• You see withdrawals from your bank account that you can’t explain.
• You don’t get your bills or other mail.
• Merchants refuse your checks.
• Debt collectors call you about debts that aren’t yours.
• You find unfamiliar accounts or charges on your credit report.
• Medical providers bill you for services you didn’t use.
• Your health plan rejects your legitimate medical claim because the records show you’ve reached your benefits limit.
• A health plan won’t cover you because your medical records show a condition you don’t have.
• The IRS notifies you that more than one tax return was filed in your name, or that you have income from an employer you don’t work for.
• You get notice that your information was compromised by a data breach at a company where you do business or have an account
• If your wallet, Social Security number, or other personal information is lost or stolen, there are steps you can take to help protect yourself from identity theft.  

Equifax’s Explanation of What Went Wrong

So, what has happened here, anyway?  Equifax has issued a long news release giving details.   I’ve inserted the full text of their news release, entitled “Consumer Notice” below for your convenience. 

Notice that they are telling you that “names, Social Security numbers, birth dates, addresses, and in some instances, driver’s license numbers … [and] credit card numbers for approximately 209,000 consumers and certain dispute documents… have been stolen.

Their release follows:

At Equifax, protecting the security of the information in our possession is a responsibility we take very seriously. This is to notify you of a data security incident that may have exposed some of your personal information, including your Social Security number and other identifying information. This

Top Online Banks - Forget the Brick and Mortar if You Dare

It's not new, really - the idea of online banking.   No drive through tellers, no big brick building with security guards and alarms and cameras high up in the corners.  These online bank alternatives are still protected by the FDIC (I know, I know - for whatever that's really worth these days), and some have been around for several years now. 

Bargaineering (now WalletHacks) has a nice list of the top online banks in their opinion.  Checking, savings, minimum deposit, fees. 

MSN has created a best online bank list as well -- they give lots of details about online banks versus traditional institutions, including features that may make internet-only banks more palatable for you than your mother's store down the street. 

Consumer Search reviews the service of online banking, without distinguishing online-only from brick and mortar.  The results?  Bank of America comes in first, but an online-only bank, ING Direct, comes in second.  They've also compiled a list of their best internet-only banks (after ING comes Ally, if you're interested).

Updated to include 2017 link to WalletHacks on October 7, 2017.

The FDIC Watch List: Should You Pull Your Money Out of Your Bank?

Yesterday, I was buying groceries at the local HEB and as usual, I whisked my debit card through the little black box, inputed my passcode, and waited for my receipt ... only to have the cashier ask me to run the card again - it hadn't gone through.

Now, I always know the balance in my checking account and my first thought was Identity Theft! But with today's economic mess, right on its heels was my second thought, My Bank's Gone Under!

Turned out that the cashier hadn't pressed a button, and my second attempt worked just fine ... but I got to wondering about the security of my bank deposits and went surfing on the web to investigate.

Here's what I learned:

1. On August 26, 2008, FDIC chairwoman Sheila Barr had a press conference where she announced that 117 banks were now on the FDIC "watch list," up from 90 banks at the beginning of the year. So, they've added 27 banks to the list in the past 8 months. It's the highest number in the past 5 years.

2. At this press conference, the head of the FDIC didn't release the actual list. The feds don't want to give out that actual information, because they are afraid that depositors will read the list, and run to take their money out of those banks on the list. The FDIC Watch List is as big a secret as the recipe for Kentucky Fried Chicken, it seems.

Of course, there's not enough cash in these banks to cover a run - banks loan money, that's how they make a profit (think Jimmy Stewart in It's A Wonderful Life) ... and the FDIC would have to step up and provide cash to cover the depositors' demands - and that's true for the healthiest of banks. The problem these days, apparently, is that loan business hasn't been profitable.

3. So far this year, 13 banks have failed in the US (WaMu was number 13). Only three (3) banks failed in 2007. A banking analyst interviewed by ABCNews opines that we'll see over 100 bank failures by the end of 2009, although most will be "small institutions."

4. LACE Financial (a company that monitors the banking industry) reports that for commercial and savings banks, net income was 74% lower in the 2nd quarter of 2008 (April, May, June) than it was for the first quarter (Jan, Feb, March) -- and that the 2nd quarter of 2008 was 87% lower than it was last year, in 2007. This is industry-wide: sounds like banks are not making any money, huh?

The FDIC Watch List -- and Other Bank Ranking or Watch Lists

5. There are companies or groups that rank the safety of banks, independently of the FDIC. These include:

• Bauer Financial (go to their site, find your state or your bank)
• LACE Financial (LACE doesn't offer up its "Watch List" online for free; however, it does report that in the second quarter of 2008, its D List (next to the lowest ranking) rose by 40% and its E list (lowest ranking) rose by 64%. Right now, LACE has 684 banks on its D List, and 490 institutions on its E list. And, LACE also finds its List to be more accurate than the FDIC Watch List, because the FDIC List has to await the bank examination process and the CAMEL ratings - the LACE list is simply faster to finalize. )
• VeriBanc (you're invited to call and chat with them -- but there's a fee)
• The Implode-O-Meter (a non-industry participant that has created its own ranking system and website list -- "implode," defined as "the "imploded" status is somewhat subjective and does not necessarily mean operations are ceased permanently: it can mean bankruptcy filing, temporary but open-ended halting of major operations, or a "firesale" acquisition. The Companies include all types (prime, subprime, or a mix of both; retail or wholesale; subsidiaries and entire companies). Note: Companies listed here may still be operating in some capacity; check with them before making assumptions." According to this Watch Group, 286 major financial institutions have "imploded" in the US over the past year and a half (since 2006). )

So, with this scary news, what do you do? Do you pull your money?

6. If you've got money in a bank, the first thing you should know is whether or not your money is deposited at an institution that is protected by the FDIC. Go check the FDIC online list to find out. Whether or not the FDIC is strong enough to handle the hits it may be facing is one issue (watch for an upcoming post on that concern)but not having your money in an account that's even offered FDIC protection is another. If you're banking, then you want FDIC protection.

7. Next, remember that the FDIC doesn't cover everything -- the contents of your safety deposit box aren't covered; any amounts over $100,000 in your checking account and $250,000 in your IRAs aren't covered; money market funds, etc. are not covered. Move your funds around, as needed, to make sure you are within the guidelines -- and if you've got cashed stashed in those safety deposit boxes, think about whether that's the best place for it to be.

8. If your bank fails, and it's protected by the FDIC, then you may face a couple of days where access to your account might be hampered. Keep some cash on hand, if you can, to cover the necessities -- diapers, gas, things like that.

9. If you choose to take your money out of a bank, then you're faced with difficulties. First, how to protect it. That's one reason for a bank, right? Fire, burglary - these are real threats to your nest egg. Also, you're going to face a difficult time paying your bills if you've been accustomed to writing a check, or paying online. You can pay by money order, but it's a hassle. Maybe you stash cash and keep an account open at an institution you consider safe, just to pay bills - keeping as little cash there as possible, depositing right before you pay the monthly invoices?

What does all this mean?

10. Here's LACE Financial's outlook:

The financial condition of the U.S. banking system is rapidly deteriorating as the increased number of banks on the LACE Watch List reflects. It appears to us that nineteen of these banks should have already been closed and thirty-two other banks require capital infusions or regulatory assistance. A major cause of failure for several of these banks will be due to high concentrations in real estate construction lending. Given the likely resource constraints of Federal regulators, we would expect a measured closure rate of approximately ten banks by the end of 2008 with failure rates accelerating after the first of the year. As such, LACE Financial maintains a negative outlook for the U.S. banking system.

11. For me, this means that this Fall will be bad, but next year will be worse -- unless some major events transpire. In my surfing around, I've started to see the phrase "slow depression," mentioned quite a bit. I'm going to pray and study a lot, take it a day at a time, and a step at a time, and I'm going to read those folk over at the Daily Reckoning, among others. They've been warning about this crisis for a long time now.

Fear is Your Enemy

Fear can hurt you, even destroy you. This is no time to panic, it's time to be smart. You will get through this. Everything is going to be alright -- maybe not the same, but you and yours will be okay. And, if you're already in the process of living a simplicity lifestyle, you're ahead of the game.

For more information:

What is Simplifying? Should You Do It?
Starting to Simplify - Step 1
Starting to Simplify - Step 3
Are You Brave Enough to Read Empire of Debt?

Freebies: Washington Mutual Checking Account

Clever advertising is just a good choice in agencies. How good is the WaMu offer? Well, it's true: you get a checking and a savings account for free. This includes free checks, free online banking (including bill pay) and a free ATM card (gold). Branches are popping up everywhere, so convenience shouldn't be an issue.

There are drawbacks, tho: it may work a little differently than your other bank. For instance, make a deposit and you get a confirmation sheet that could easily be confused with your Starbucks invoice. No formal banking slip here.

Go inside to get some cash, and you see kiosks with tellers standing there. There's not any long bar, with windows, separating the two of you. Cash withdrawals here get you a paper slip, which you take over to a withdrawal machine in the corner - near the guard - and get your own cash. When I asked the bank clerk what she thought about this, she said she felt safer with this system. Me? I'd prefer the long bar and the big windows ....

As for customer reviews, there's a lot of bad juju online. Surf through My3Cents.com, EOpinions, and RateItAll.

Can't tell you any more than that. I opened one out of curiosity, really -- and I'm not sure how much trust I really have in WaMu, frankly. That kiosk business is strange, and I like a standard deposit slip, somehow.